In an interview with ProMarket, former FCC chair Reed Hundt spoke about antitrust, Big Tech platforms, the future of the 1996 provision that provided legal protection to social media companies from liability for harmful content, and Facebook. “Mark Zuckerberg, god bless him, who is a smart but really lucky guy, should not be surprised that people want to break up his company.”
Elizabeth Warren was the first democratic presidential candidate to wage a campaign against the big tech platforms; last year, the Massachusetts Senator called for a break up of Google, Facebook, and Amazon.
Warren’s campaign has lost some steam in the last couple of weeks, but if Mark Zuckerberg had hopes that the current leading candidate, Joe Biden, would be much more friendly, Biden’s interview in the New York Times last week, which surprised many people in the policy world, might suggest otherwise.
In the interview, Biden called for a complete recall of Section 230 of the Communications Decency Act, the 1996 provision that provided legal protection to social media companies, including Facebook, from liability for users’ posts.
The former vice president’s position, as expressed in the interview with the New York Times editorial board, is more extreme than that of other lawmakers who have confronted tech executives about Section 230. “Section 230 should be revoked, immediately should be revoked, number one. For Zuckerberg and other platforms,” Biden said.
Section 230 consists of only 26 words. It stipulates: “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Yet those 26 words are probably among the most influential pieces of legislation in the digital economy.
According to Jeff Kosseff, author of the book The Twenty-Six Words That Created the Internet, Section 230 would come to mean that, with few exceptions, websites and internet service providers are not liable for the comments, pictures, and videos that their users and subscribers post, no matter how vile or damaging. According to Kosseff’s account, the bill’s proposal and passage flew under the radar; it received virtually no opposition or media coverage, as it was folded into the more controversial Communication Decency Act, which was added to the Telecommunication Act of 1996, a sweeping overhaul of US telecom laws.
The debate on Section 230 has picked up in the last 18 months, as scrutiny of Facebook and its inability (or unwillingness) to control the spread of fake news and election interference increased [read the Stigler Center Committee on Digital Platforms recommendations on how to reform Section 230 here and here]. But one voice that has not been heard so far is that of the person who oversaw the creation of Section 230: that of Reed Hundt, chairman of the Federal Communications Commission during the Bill Clinton administration (1993-1997) and the author of the 2019 book A Crisis Wasted: Barack Obama’s Defining Decisions. We recently interviewed Hundt in Washington about antitrust, Big Tech platforms, and the future of Section 230.
“In every country, almost without exception, there is an antitrust policy and an antitrust history, and in every single country the narrative of this antitrust oscillates between applying some rigorous economic theory designed to promote efficiency, with a willingness to have winners, and another school where it is not just about efficiency—it is also about the social impact. And it goes back and forth,” Hundt says. “In the United States, almost uniquely among countries, the narrative in the rulings was about nothing other than efficiency, from roughly the late 1970s, which is when I started [working] at antitrust practice, until a couple of years ago. It is the longest run for the efficiency school that you’ll find in any country. That philosophy was meant to allow some companies to win the competition and become monopolies or oligopolies. That was the idea—it wasn’t an accident.”
Q: Is this true even for Big Tech?
Until recently, there has never been any worry about someone else not coming along in tech [and creating competition] because of the [tech] innovation. The thing that’s different, and only in the last five or six years, is that we don’t know how to deal with the embedding of a few companies into society. The problem is not really in markets, but in society. What is the Facebook market? The market for no one charging you to put your own content on a page? If you look at it as a market, as with Facebook, you see that a fairly small percentage of the overall online advertising market goes to Facebook, and that doesn’t really worry you. But you are worried about the embedding of the company in the society. And it is the same thing with Amazon and the same thing with Google. It is exactly the same as with AT&T: one company, everybody has a phone line, they define the technology and they do everything—so the government broke it up.
My conclusion is that Mark Zuckerberg, god bless him, who is a smart but really lucky guy, should not be surprised that people want to break up his company, because it’s exactly the same thing that happened to AT&T and also Standard Oil. Standard Oil was also embedded in society in every conceivable way: in shipping, transportation, industrial process, heating. When companies are that deeply entrenched, it isn’t anymore just about efficiency and markets—it is about their political power, social power, and influence power. And if you are Facebook and you say, “We know that we are powerful, but our powers are such superpowers that we ourselves cannot control them’”—this is not what I would call a workable excuse.
Q: So what will governments do?
I think history teaches you that the response is going to be breaking up that company. With Amazon, the idea that Amazon can have this reach and then privilege its own source of supply on its websites, that’s not going to wash. That’s not going to happen. What I am saying is that this change in antitrust is really just about the companies that are so embedded in the information society. It is not really a rethinking of antitrust.
| “We were naïve. We were naïve in a way that is even hard to recapture. We all thought that for people to be able to publish what they want would so enhance democracy and so inspire humanity, that it would lead to kind of flowering of creativity and emergence of a kind of a collective discovery of truth.” |
Q: You were involved in the Telecommunications Act of 1996, and specifically Section 230. Do you still think that we should give platforms this immunization from responsibility for the content they publish and spread?
We were naïve. We were naïve in a way that is even hard to recapture. We all thought—Al Gore, me—that for people to be able to publish what they want would so enhance democracy and so inspire humanity, that it would lead to kind of flowering of creativity and emergence of a kind of a collective discovery of truth. That’s what we really did think. And we thought people won’t just believe what their monopoly newspaper tells them—no offense to newspapers. We were naïve, [but] I do think that the explosion of creativity—we were right about that.
Q: If you were FCC Chairman today, would you recommend a repeal of Section 230?
Technically speaking, I would probably modify it, but it shouldn’t stay the way it is. It immunized [tech platforms] from too much.
Q: Can you think of an example of such a modification?
This can get too lawyerly, but I will just give one example. Facebook has no editors, so the question is, if they make mistakes and they have no editor, when are they liable? They have created their own judiciary. Are they going to have their own legislature? Well, they have their own currency. Could you people please take a humble pill? Could you people please get grounded? There should be a court that reviews what you’re doing, but it shouldn’t be your court.
The rules in the US are well known: You can be less cautious with public figures, and you have to be super cautious with private figures. You have to have editors and there is a cost to that, and you have to bear the cost. This is the way to have a reasonably civil society, and that’s what Section 230 should say.
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